-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, J4hIRKI8fDSKpbkYWApBl+EzzaVzoc+Sz/eTr7TwwogHDQm4x1Qjhxfx5Z80ZqNp /42TzOssSwOkczTxG+OnUQ== 0000950124-05-006879.txt : 20051219 0000950124-05-006879.hdr.sgml : 20051219 20051219161503 ACCESSION NUMBER: 0000950124-05-006879 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20051216 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051219 DATE AS OF CHANGE: 20051219 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STARBUCKS CORP CENTRAL INDEX KEY: 0000829224 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING & DRINKING PLACES [5810] IRS NUMBER: 911325671 STATE OF INCORPORATION: WA FISCAL YEAR END: 1002 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20322 FILM NUMBER: 051272713 BUSINESS ADDRESS: STREET 1: P O BOX 34067 CITY: SEATTLE STATE: WA ZIP: 98124-1067 BUSINESS PHONE: 2064471575 MAIL ADDRESS: STREET 1: 2401 UTAH AVENUE SOUTH CITY: SEATTLE STATE: WA ZIP: 98134 8-K 1 v15587e8vk.htm FORM 8-K e8vk
 

 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
 
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
December 16, 2005
Date of Report (Date of earliest event reported)
STARBUCKS CORPORATION
(Exact name of registrant as specified in its charter)
         
Washington   0-20322   91-1325671
(State or other jurisdiction of
incorporation) 		  (Commission File Number)   (IRS Employer Identification No.)
2401 Utah Avenue South
Seattle, Washington 98134
(Address of principal executive offices) (Zip Code)
(206) 447-1575
(Registrant’s telephone number, including area code)
 
     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

 

 

Item 1.01. Entry into a Material Definitive Agreement.
     On December 16, 2005, Starbucks Corporation (the “Company”) entered into an amended and restated employment agreement (the “Amended Agreement”) with Howard Behar, a former executive and a current member of the Board of Directors of the Company. The Amended Agreement amends and restates Mr. Behar’s employment agreement dated May 6, 2003 (the “Prior Agreement”). The Amended Agreement is filed with this report as Exhibit 10.1, and the material terms and conditions of the Amended Agreement are described below.
Duties
     Under the Amended Agreement, Mr. Behar will continue to provide reasonable advisory services from time to time on an “as needed” basis to the president and chief executive officer of the Company (or his or her designee) through October 31, 2010 (the “Term”).
Payment of Deferred Compensation
     The Prior Agreement provided for payment of $1,800,000 in deferred compensation in specified installments, of which the Company has paid approximately $700,000 through December 2, 2005. The Amended Agreement terminated that deferred compensation arrangement and provides that the Company will pay to Mr. Behar the unpaid balance of the deferred compensation (approximately $1,100,000), less regular wage withholding, as soon as administratively practicable but in no event later than December 31, 2005.
Base Salary
     During the Term, Mr. Behar will be paid a salary that annualizes to $25,000. In the event that Mr. Behar dies before the end of the Term, the Company will pay, or cause an insurer to pay, to Mr. Behar’s surviving spouse (or to his estate if his spouse does not survive him) a single sum amount equal to the unpaid base salary Mr. Behar would have received through the Term.
Bonus
     Mr. Behar remains ineligible for any type of cash bonus.
Equity Awards
     Through the remainder of the Term while Mr. Behar remains employed by the Company, Mr. Behar will receive an annual Award (as defined in the Company’s 2005 Long-Term Equity Incentive Plan (the “Omnibus Plan”) and the 2005 Key Employee Sub-Plan (the “Key Employee Plan”)) under the terms of the Omnibus Plan and the Key Employee Plan made at the same time as the annual grant of Awards under the Key Employee Plan. Each such Award will have a fair value equal to $105,000 (rounded to the nearest whole share of stock or other Award increment) on the grant date, calculated in accordance with the methodology used for valuing the Award by the Compensation and Management Development Committee of the Company’s Board of Directors. If the Award is in the form of stock options, its exercise price will equal the fair market value of the Company’s common stock on the grant date. Assuming Mr. Behar’s continued employment by the Company, each Award will fully vest one year after the date of grant. All other terms of the Award will be consistent with the standard form of grant agreement under the Key Employee Plan as in effect on the date of grant, except that if the Award is subject to vesting, the vesting of the Award will not be accelerated upon Mr. Behar’s “Retirement”, as

 

 

that term is defined in the Omnibus and Key Employee Plans. During the Term, Mr. Behar will be considered an employee director of the Company and therefore ineligible to receive any compensation for his service as a director.
Benefits
     Mr. Behar will continue to be eligible for employee benefits in accordance with the terms of the Company’s medical, dental, vision and 401(k) plans. Mr. Behar also will be eligible for basic life insurance coverage and short-term and long-term disability coverage, all of which coverages will be determined in accordance with his base salary, and the terms of the governing plans.
Expenses and Administrative Support
     The Company will reimburse Mr. Behar for all reasonable and customary expenses incurred by him in performing his duties, including, but not limited to, reasonable travel expenses. To assist Mr. Behar in his advisory role, the Company will continue to provide an office, computer, cell phone and administrative and secretarial assistance as Mr. Behar reasonably requires. In addition, Mr. Behar will continue to have access to the Company’s corporate offices and parking garage at the regular parking fee.
Termination
     The Company may terminate the Amended Agreement prior to October 31, 2010 if Mr. Behar is unable to perform his duties because of physical or mental disability. The Company also may terminate the Amended Agreement prior to October 31, 2010 “for cause” to include, without limitation, Mr. Behar’s unreasonable refusal to perform his duties or any violation of the Company’s Standards of Business Conduct.
     Mr. Behar may terminate the Amended Agreement before October 31, 2010 by providing the Company with notice of his resignation. In the event Mr. Behar resigns, the Company will pay his base salary through the end of the workweek in which it receives his notice of resignation and Mr. Behar will not be entitled to any further compensation or benefits as an employee except as is provided to a retiree generally.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits.
     
Exhibit No.   Description
10.1
  Amended and Restated Employment Agreement dated December 16, 2005 between Starbucks Corporation and Howard Behar.

 

 

SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
         
  STARBUCKS CORPORATION
 		  
Dated: December 19, 2005  By:   /s/ Michael Casey    
    Michael Casey   
    executive vice president, chief financial officer and chief administrative officer   

 

 

         
EXHIBIT INDEX
     
Exhibit No.   Description
10.1
  Amended and Restated Employment Agreement dated December 16, 2005 between Starbucks Corporation and Howard Behar.

 

EX-10.1 2 v15587exv10w1.txt EXHIBIT 10.1 EXHIBIT 10.1 [LETTERHEAD OF STARBUCKS CORPORATION] December 15, 2005 Mr. Howard Behar Starbucks Corporation 2401 Utah Avenue South Seattle, Washington 98134 RE: AMENDED AND RESTATED EMPLOYMENT AGREEMENT Dear Howard: This letter contains your amended and restated employment agreement with Starbucks Corporation ("Starbucks") effective as of November 28, 2005 ("this Agreement"), and replaces in all respects your employment agreement dated May 6, 2003 (the "Prior Employment Agreement"). EMPLOYMENT TERM Your employment commenced on November 1, 2002, and shall continue until October 31, 2010 (the "Term"). If this Agreement is earlier terminated as provided below, the Term shall end on the date of such earlier termination. DUTIES During the Term, you will be asked to provide reasonable advisory services from time to time on an "as needed" basis to the president and chief executive officer ("ceo") of Starbucks or the ceo's designee. You will not be required to provide services for which you are not qualified. You may perform services for others on a paid consulting basis, and you may serve on boards of directors of other companies so long as such activities do not conflict with the Starbucks Standards of Business Conduct or your duties as a Starbucks director. BASE SALARY You will continue to be paid bi-weekly at a base salary that annualizes to $25,000.00, less regular wage withholding, during the Term in consideration for your ongoing role as a non-executive advisor to Starbucks. You are not eligible for any type of cash bonus from Starbucks. If you die prior to October 31, 2010, Starbucks will pay, or cause an insurer to pay, to your surviving spouse (or to your estate if your spouse does not survive you) a single sum amount equal to the unpaid base salary you would have received through the then remaining Term. Mr. Howard Behar December 15, 2005 Page 2 BENEFITS You will continue to be eligible for employee benefits in accordance with the terms of Starbucks medical, dental, vision and 401(k) plans. The required employee contributions for coverage under these plans will be deducted from your bi-weekly paychecks. You will also be eligible for basic life insurance coverage and short-term and long-term disability coverage, all of which coverages will be determined in accordance with your base salary, and the terms of the governing plans. DEFERRED COMPENSATION The Prior Employment Agreement provided for payment of $1,800,000.00 in deferred compensation in specified installments. Through December 2, 2005, Starbucks has paid $693,172.90 accordingly. That deferred compensation arrangement will be terminated as of the effective date of this Agreement and the unpaid balance paid to you, less regular wage withholding, as soon as administratively practicable but in no event later than December 31, 2005. You will not be eligible to participate in the Starbucks Corporation Management Deferred Compensation Plan (the "MDCP") in 2005 and for the remainder of the Term. This Agreement does not affect your pre-2005 accounts in the MDCP, which accounts remain subject to the terms and conditions of the MDCP. EQUITY AWARDS Through the remainder of the Term while you remain employed by Starbucks, you will receive an annual Award (as defined in the 2005 Long-Term Equity Incentive Plan (the "Omnibus Plan") and the 2005 Key Employee Sub-Plan (the "Key Employee Plan")) under the terms of the Omnibus Plan and the Key Employee Plan made at the same time as the annual grant of Awards under the Key Employee Plan. For each such Award, its fair value will equal $105,000.00 (rounded to the nearest whole share of stock or other Award increment) on the grant date, calculated in accordance with the methodology used by the Starbucks Compensation and Management Development Committee for valuing the Award. If the Award is in the form of stock options, its exercise price will equal the fair market value of Starbucks common stock on the grant date. Assuming your continued employment by Starbucks, each Award will fully vest one year after the date of grant. All other terms of the Award will be consistent with the standard form of grant agreement under the Key Employee Plan as in effect on the date of grant, except that if the Award is subject to vesting, the vesting of the Award will not be accelerated upon your Retirement, as that term is defined in the Omnibus and Key Employee Plans. During the Term, you will be considered an employee director of Starbucks and therefore ineligible to receive any compensation for your service as a Starbucks director. Mr. Howard Behar December 15, 2005 Page 3 EXPENSES AND ADMINISTRATIVE SUPPORT Starbucks shall reimburse you for all reasonable and customary expenses incurred by you in performing your duties, including, but not limited to, reasonable travel expenses. To assist you in your advisory role, Starbucks will continue to provide an office, computer, cell phone and administrative and secretarial assistance as you reasonably require. In addition, you will continue to have access to the building and parking garage. The parking fee will be deducted from your paychecks. TERMINATION Starbucks may terminate this Agreement prior to October 31, 2010 if you are unable to perform your duties because of physical or mental disability. Starbucks may also terminate this Agreement prior to October 31, 2010 "for cause" to include, without limitation, your unreasonable refusal to perform your duties or any violation of the Starbucks Standards of Business Conduct. You may terminate this Agreement before October 31, 2010 by providing Starbucks with notice of your resignation. In the event you resign, Starbucks will pay your base salary through the end of the workweek in which Starbucks receives your notice of resignation and you will not be entitled to any further compensation or benefits as a partner of Starbucks except as is provided to a Starbucks retiree generally. MISCELLANEOUS This Agreement contains the entire agreement between the parties and supersedes any and all prior and contemporaneous oral or written agreements or understandings pertaining to the subject matter herein. No amendment to this Agreement will be effective unless it is in writing and signed by both parties. This Agreement will be governed by the laws of the State of Washington, without regard to its conflicts of law provisions. This Agreement may be executed and delivered (including by facsimile transmission) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Howard, thank you for your continued service to Starbucks and our partners, shareholders and customers. If you agree with the terms and conditions of this Agreement specified above, please sign in the space provided below and return the original to me. Mr. Howard Behar December 15, 2005 Page 4 Warm regards, /s/ Jim Donald Jim Donald president and chief executive officer I agree to the terms and conditions of this Agreement, which I have read and understand. /s/ Howard Behar - -------------------------------------- Howard Behar 12-16-05 - -------------------------------------- Date -----END PRIVACY-ENHANCED MESSAGE-----